Sebi to registrar and share transfer agents: IMPLEMENT! Develop inter-operable platform to enhance investor experience in mutual funds

Markets regulator Sebi on Monday asked RTAs to implement system interoperability amongst themselves for making it convenient for investors to transact and avail services while investing in mutual funds.

The platform will in phases, enable a user-friendly interface for investors for execution of mutual fund transactions, initiation and tracking of service requests as well as queries and complaints, access investment related reports, transactions reports, capital gains or loss report, details of unclaimed dividend and redemption among others.

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The regulator has asked asset management companies (AMCs) and depositories to facilitate the registrar and share transfer agents (RTAs) for development of the proposed platform.

Through this platform, investors will be able to access these services for all mutual funds in an integrated manner, the Securities and Exchange Board of India (Sebi) said in a circular. "RTAs shall implement standardized practices, system interoperability amongst themselves to jointly develop a common industry wide platform that will deliver an integrated, harmonized, elevated experience to the investors across the industry," Sebi said.

The regulator said that AMCs, RTAs and depositories will have to take necessary measures to provide data via APIs on a real time basis to the proposed platform.

Additionally, RTAs and depositories will also share their respective data feeds between themselves for generation of investment related reports.

The platform may also over time, provide services to the distributors, registered investment advisors, AMCs, stock exchange platforms and digital platforms for transacting in mutual funds to further augment ease of investing and servicing of investors through the stakeholders in consultation with Sebi.

Further, AMCs, RTAs and depositories will have to review and agree to harmonize the processes across the industry to provide a single-window, integrated, simplified investment and service experience for the investors.

In addition, they will have to adopt the data definitions and standards as recommended by Sebi for data exchange amongst various participants.

The platform should be scalable with robust cyber security protocols and supported through an API-based architecture.
In this regard, Sebi said the platform will have to adopt the cyber security and cyber resilience framework specified by the regulator from time to time to market infrastructure institutions -- stock exchanges, depositories and clearing corporations -- and qualified RTAs.

Further, on request basis, APIs could be exposed to other industry stakeholders such as distributors, registered investment advisors, stock exchange platforms and digital platforms among others with due approval of the concerned mutual fund on mutually agreed terms.

The RTAs will be jointly and severally responsible for compliance with all the applicable regulations including system audit and cyber security audit.

Further, RTAs will have to ensure that the platform complies with the guidelines for Business Continuity Plan (BCP) and Disaster Recovery (DR) specified to MIIs.

All the stakeholders have been asked to collaborate and work together towards the development and implementation of the proposed investor-friendly platform.

AMCs and Depositories will have to facilitate and RTAs will have to make the platform operational in a phased manner (starting with non-financial transactions) and will be fully operational by December 31, 2021.
The regulator has asked AMCs, RTAs, depositories, industry body Amfi and key stakeholders to create awareness about this initiative amongst the investors.